Episode 217 of the Diary of an Apartment Investor Podcast with Sean Thomson. Transcript by Otter.ai – please forgive any errors.
Brian Briscoe 0:00
What advice would you give an aspiring investor? That's maybe six to 12 months behind where you're at now?
Sean Thomson 0:05
Well, first of all, it starts with your dream, right? What do you want to do? What What's your vision? What's your line, your dream, but I think the first hurdle that everybody over has to overcome is believing. Right? They have to believe that it's possible for them, you can see that it's possible because you're doing it, I'm doing it right. So someone said themselves, hey, I want to buy an apartment building, you can see that it's possible. It's, there's people out there executing this somebody else. But believing that you can do it is the biggest struggle really, I think, and that's something that you said that sticks with you, you have to constantly remind yourself I can do this right.
Brian Briscoe 0:43
Welcome to the diary of an apartment investor podcast with your host Brian Briscoe. In this podcast we bring some of the top professionals in the apartment investment fields to discuss various aspects of the apartment investing journey with the sole purpose of educating listeners to make wise investment decisions. The Diary of an apartment investor podcast is sponsored by four oaks capital, bringing you high yield returns through apartment complex investing. Welcome to the diary of an apartment investor podcast. I'm your host, Brian Briscoe with Forbes capital. Very excited for today's show. It's another one of our first deal series episodes. And you know, we have Shawn Thompson on the line with us. who recently closed on a I think is a 76 unit apartment building in Irving, Texas, just outside of Dallas, for $8 million. Is that right? Yeah. Hi, Brian.
Sean Thomson 1:29
Thanks for having me on the show. Yeah, that's, well, it's a little under 8 million, just just shy of 8 million is what it cost. Well, we
Brian Briscoe 1:34
like to round up, you know, 8 million sounds a lot better than, you know, seven and change. So yeah, it was good. But yeah, that's it. You're welcome. And thanks for being on the show.
Sean Thomson 1:43
Thanks a lot. Thanks for having me.
Brian Briscoe 1:44
Yeah. And incidentally, great meeting you in person. And Jake and Gino. That was that was a good time. Always, always nice to have, you know, one physical touch point with people. So that said, Do us a favor and tell us a little bit about your background and kind of lead us into how you got into multifamily?
Sean Thomson 2:02
Well, I started pretty late in multifamily. For sure I started really late in and actually in real estate investing. I worked my whole life I've been in the cycling industry for you know, since I was 18. Really, I guess my biggest main job was I was the operations and equipment manager for USA Cycling. So I worked with the athletes that went to the Olympics in the mid 90s. That was kind of my my job back then. But I've worked in that business forever. And I didn't get into real estate till I was about 40 You know, just under 40 years old, like 3040 years old. So I really got started kind of late doing this stuff. But
Brian Briscoe 2:35
now I'm gonna say very young. So let's let's Yeah, what's that he's still very young. So
Sean Thomson 2:42
career wise, I think it's a bit late to make a big change. I made a major change from from, you know, but the cycling business to to real estate at that age was a little bit changed. But yeah, so I transitioned to single family real estate, you know, it's probably a decade or so ago that I kind of got started in that. And I didn't really know how to make it a business. It was always kind of like I knew how to buy houses and I knew how to kind of buy houses, fix them up make money, but doing that over and over and over again making money doing that every day. I didn't know how to do that. But I my first house that I bought my contractor was working on his investing job or career as well. And he just bought a home busters franchise. I don't know if you're familiar with home busters the We Buy ugly houses guys. Oh, yeah, yeah,
Brian Briscoe 3:27
I've seen the signs the bandit sign people.
Sean Thomson 3:29
Yeah, they're all over. But so he bought this franchise. And it was kind of exactly what I've been looking for. I've been looking for a system that shows you how to kind of replicate this business. And so I went down right away and bought a franchise. And I was with him for a couple years. It was great education, but their interests in my business were different than I thought they should be. So I said I'll see you later. And I was on my own for a really long time. But my goal in my investing has always been income, right? And so I wanted you know, I want to invest and earn income every month and single family just wasn't wasn't hitting the pace. And so a couple years ago, I transitioned into multifamily.
Brian Briscoe 4:07
Nice, nice, nice. So what what got you from the cycling industry to the real estate industry? What? What was kind of going through your mind when you made that transition? And then same question between single family and multifamily?
Sean Thomson 4:22
Well, you know, I've always had high aspirations for my financial freedom, right? I've always wanted to be able to just write a check for problems, right? If I get sick or someone in my family gets sick, and I don't want I don't want my doctor bills to bankruptcy, you know, I want to be able to discover those things. I want to be able to pay for my mortgage, my cars, you know, I want to be able to pay for a lifestyle that makes me happy. I've always had those aspirations. And, you know, the cycling business was kind of a passion of mine I love by bike riding and cycling, but it just, I could never get to an income level that was sufficient to make those things possible. You just can't write a $500,000 check to a doctor if you're sick on an on a salary on the cycling industry just just not doesn't really tap in, right? Yeah. So real estate was always kind of something that I wanted, you know. And I read, of course, this is the pivotal book for everybody. But Rich Dad Poor Dad, right? Yep, yep. And I read that when I was, I guess, 30. So I was about 30 or so. And so ever since the age is 30. I'm like, I really want to change this, but I didn't know how right I just didn't know what what steps to take. And so I just worked as being responsible, you know, adult and responsible parent and working and paying for my, my family. And that's when I lost my my job. I said, Look, that's it, I'm not going back to a job, I'm going to make this happen, or I'm gonna die trying right. And so I I went out, like I said, before I buy went, just figured out how to buy a house and fix it up, right? And it just sort of grew from there. Once I started getting the resources and sort of the path to creating this business. That's that was what I wanted to do. But even in the beginning, I would drive down the street and see an apartment building and think to myself, Man, if I could just own one of those, right? If I could just have one of those that would fix my problems. Right? that would that would. That's exactly what I want. And I've had that dream for forever, right. And I always thought it was impossible. I thought I thought multifamily was just for hedge funds and REITs and high finance guys. I didn't know it was individuals like me that could even do that.
Brian Briscoe 6:24
You mentioned that, you know, when I read Rich Dad, Poor Dad, he talks a lot about multifamily and commercial real estate and among other things, but I think one of his big focuses is commercial real estate. I read that book, I came away with the same thing. You know, hey, commercial real estate sounds great for somebody else, you know, and it sounded too complicated for me. But fortunately, I was able to think big for me at the time, which was single family homes. So I started buying single family homes, as rentals, you know, so I think that there's some similarities there, you know, where we both looked at the multifamily and said, That's a bridge too far for me right now. So anyway,
Sean Thomson 7:07
it just always seemed out of reach. Yeah, it just seemed like I don't know if I could ever get there seemed like high finance. It seemed too complex. It just seemed too big. Right. And so
Brian Briscoe 7:15
what did you What did you do to make that that mental leap? I think a lot of people struggle with the same thing. Hey, I can imagine doing single family. But multi families just wow. How did you make that leap?
Sean Thomson 7:30
Well, I met Cory Peterson, honestly, I'm so I have I was an investor, fuel mastermind. And Cory is part of that investor mastermind with my camera, Mike's a good friend of mine. And Cory came in and did a talk one day, and I went as he's talking, he was telling his story. I mean, you know, he's a simple man, he comes from Missouri. And he's done. He's done a massive business for himself. And I'm listening to this guy talking. I'm like, that is exactly the dream that I have reoccurring in my mind. You know, it was all I could do not to step up, stand out of my chair and grab the guy. And so you got to, you got to show me how to do this right now. You know, I was so excited hearing his story. Because what happened was, it took this big impossible thing that I thought was out of my reach and made it real for me, right? So I, there's a guy standing in front of me, you know, looks just like me, we're just regular guys. And he's making this work. And I'm like, Man, I if you can do it, I can do it. Right. And so I said you have to teach me how to do this. And luckily, he has a coaching and training program. You know, he does Kahuna boardroom and a few other things. And so I immediately joined his boardroom, well, actually, no, it's so it took me about a year actually, I saw it, I saw that it was possible. And I, I started, I was still in my single family business. I'm like, I've got to give up my single family business to go make this happen. Because I can't I can only do one thing at a time. I can't do two businesses it just too much for me. So I said I'm gonna have to give up my single family business to go do this multifamily took me a year to kind of kind of work that out. In my mind, if I really wanted to do that. Because I had a pretty successful I was happy with my single family business. And to give that up to go do something completely new that may or may not work was was scary. So I finally made the decision that I started joining Corys programs and he kind of laid the foundation for me to learn and move forward with the multifamily business.
Brian Briscoe 9:19
I really like Corey Peterson. You know, we've had him on the show. And just like, like you said, he's a really, really simple guide down to earth. You know, and one, one thing I really enjoyed about him is I remember seeing him on stage once upon a time where, you know, he basically had one hand up one hand down and said this, this is this is his attitude, he has to have one, you know, he has his own mentors. And, you know, they're pulling him up and at the same time, he's reaching down with one hand, I think, I think he has a really good job at that, you know, just trying to help and add value to other people. So you know, I I think that's that's similar to my story. I mean, had I known Corey Peterson before I jumped into the the microblog coaching. You know, maybe I was would have been a you know Big Kahuna board member board remember to but great guy and you know a lot a lot of similarities there with with with a lot of people do I mean you you have to get educated. And I think most people at some point realize that, you know, the education comes a lot faster if you're around people who are doing what you're doing. And if you have a mentor, you know, so it's tends to be the in a lot of ways the safer faster route even though it does cost a pretty penny to get in some of these programs. But I think you're you're paying to accelerate your business and you're paying almost as an insurance policy.
Sean Thomson 10:37
They can take your business from zero to 60. Much faster than you can. Yeah.
Brian Briscoe 10:42
So Well, before we get into deal specific stuff, you know what one question I like to ask, I like to ask everybody about their, their big burning, why and you you've kind of woven some of the threads in there, you know about why you're doing things. But if you had to boil it down to one, you know, one thing what is your big burning? Why?
Sean Thomson 11:01
Well, you know, it's evolved, right? So as you get older, you have kids, you do different things, and it's evolved. And for me, right now I have to I have essentially two things that are pushing me are driving me. So I want to be financially free, myself and my wife, you know, I want us to be able to go and have a good time and not have to worry about being at a job every day and things like that, which we have that kind of now. So I mean, we're really kind of living our dream life, we just aren't quite at our financial goals. Exactly. But so the life I have today is, um, I'm really close to being on my path to what I want to achieve on that front. And then my daughter is a part of my business too. She's, she's my partner now. And she was you know, she, when she came to me, she went to college freshman year and came to me and said, Hey, she was thinking about doing law school after graduate programming. And she said, I think I want to take a year off a gap year dad, and I said, Okay, great, that's, that's great you can do that I'm not paying for, you know, I said, if anybody's gonna gel for years could be me. And she said, Well, that's why I'm kind of talking to you, I want to figure out how to create passive income for myself, so that I can fund my travels if I decide to do that. And so we started working on a strategy plan for her This was back when I was in single family. And we put together okay, you need this many houses, it's going to need to generate this kind of cash flow for you. And we started working on an action plan to, to acquire those things for her, right. So she could she could have those travels if she wanted to do it. And around the same time I was, I was considering transitioning out of single family. And she also was considering law school at the same time, too. So I said, Hey, why don't you just join me? Be my partner in our multifamily venture. And we'll build the business, you know, so mom, and I can kind of hit our financial freedom numbers, and then you can take the business and do whatever you want, right? And I joke with people, I'm trying to build a billionaire, and my daughter and I wrote this, it's kind of a joke, but it's really kind of true at the same time. So I'm trying to build her a business that she can then take and do whatever level she wants to have her her perfect life as well. Right? Yeah. And so those are my two, those are kind of the two things that really drive me every day is making sure that my wife and I can be happy. And then making sure that my daughter has something that she can then build the life that makes her super successful at whatever level she feels is necessary and gives her something to build for the future. Right. So yeah, I love it.
Brian Briscoe 13:26
I love it. And you know, I've got two daughters that are two adult daughters now and you know, you're you're right, you're your wife transitions, you know, and up front, right? I think my big boring Why was to get out of my w two first, you know, but not now I'm reformulating you know exactly what that is. Which is, which is weird. I mean, asking, I'm asking every people a couple times a week with their big burning wires. And, you know, I'm still trying to flesh out my new why because I just retired. But
Sean Thomson 13:53
that evolves. Yeah, it does.
Brian Briscoe 13:55
It does evolve, you know, and, you know, my last big, pretty wild, like I said, you know, October 31 was my retirement date. And, you know, we're in November right now, so, you know, successfully achieve that one. But yeah, I think I think that that's gonna resonate with a lot of people, you know, a lot of people with, you know, our age with with, you know, adult, don't children, you know, it's really going to be about you know, helping them get to where they want to get financially. And, you know, also us getting to where we want to be financially so So that said, let's, let's talk deal specific stuff. You know, you mentioned your daughter's part of your team. So before we get into deal specific stuff. I guess this is part of the deal specific stuff, to be honest with you. Let's talk about the team that took down this the 76 unit, you know, how you guys came together, you know, so in addition to your daughter, you know, your the other other people who were involved with this?
Sean Thomson 14:45
Well, so we talked briefly before, but so there's my core team that I have, and then there's my ancillary team, right. So we've been looking for deals for a long time we've been sourcing deals, you know, we've gotten pretty successful at it. We've underwritten several 100 projects, we've put Several, you know, dozen ello eyes and we, we toured properties and all over our sort of our territory and stuff. And I was kind of formulating a strategy. So, but I'll talk to my, my, my core team is myself, I guess I'm the principal or the CEO of the operation. And there's my wife who she does our underwriting. She's my operations manager, she her previous career was, as I always had to remember her title, but it was a senior director allocation, something rather, what her job was, is that she, the buyers would come to her with like, I want to buy this blue shirt, and her team would figure out how many smalls medium and large must go to every store around the country, right? And they do that largely on Excel sheets. And so she for her underwriting and financial modeling, is kind of second nature. She's been doing it for 30 years, right? In the clothing business, giant clothing business, she managed a billion dollars for JC Penney's and in their inventory. So her transition in our business has been really rapid. She's she's taken to it really quickly.
Brian Briscoe 16:01
Yeah, it's just I mean, same same tools are just a slight adaptation on what your what your bottom line means and what it is.
Sean Thomson 16:10
Yeah, learning the jargon, learning the targets, learning outcomes, learning all those things, it's really that was, you know, she, she had been in my real estate business on the single family side for the last decade, too. So, you know, she does my books, she's, she's been in the trenches with me on that side, as well. So she already had a really clear understanding of what was a successful asset, you know, and what was the failure so she kind of knew a lot of that already. So she's adapted really rapidly. And she's now she does 99% of the, the work in our underwriting side, I really only touched the last, you know, the, the last five yards of the of the deal, right. And then my daughter, she graduated with her finance degree. And with a specialization in real estate, she has a minor in marketing, so she's perfect for my business as well. So she's my partner now, and she does all of our front touchpoints with us. So any investor relations, Portal, investor, Portal stuff, or social media, or podcasts, all those things, she handles all those things for us. And then I have a partner, I'm really fortunate that I have a substantial key principle partner, who has the you know, the high net worth of liquidity. And the experience that you need to kind of do this business, you know, multifamily is a business that you can't do multifamily, unless you've previously done multifamily. Yeah. So it's, it's almost like an apprenticeship where you have to have these partners that guide you through the process, even through the deals, right. And I'm fortunate that I have a really substantial, awesome partner in that, too. So. And then I think building my team on a more global or ancillary level is, when I was looking at deals, I started to realize that getting awarded deals is a lot of it's a lot of its comfort level that the brokers and sellers have with you as a as an operator. And so I started to look for resources that brokers in my area that I was talking to regularly that they were comfortable with. So they deal with certain lenders all the time, they deal with certain lawyers all the time, they deal with certain property management groups all the time. And so I went to the brokers that I was working on deals with, and I said, Hey, who do you like for lender? Right? And so I engaged that lender, and I said, Hey, this is what I'm trying to accomplish. Can you help me and they became part of my team. And I did the same thing with property management and with legal, and all those resources that you need to be successful in this business. I actually just talked to my local brokers and said, Who do you guys work with? Who do you like, and that's who I engaged as my ancillary team. And what ended up happening was, as I'm going through the deal process, trying to be awarded these deals, the brokers were comfortable with me more, because they were comfortable with my team. Yeah, right.
Brian Briscoe 18:48
Like that. I really do. I know, nobody's, nobody said it like that before. And I really, I think that's a smart way of doing it, because the broker is going to communicate to the seller, the, the offer point, you know what your number is, but they're also going to talk about the strength of the offer and the strength of the team. And, I mean, you deliberately built a team where the broker would be like, I like these guys. You know, I like the Property Management Group. You know, I've worked with them before, like the lender, I've worked with them before. You know, so your ancillary team, you know, I I like how deliberate you were with that. And I think it's, it's very smart. Like I said, I've never never had anybody explain, you know, building your team like that. And it was just like, lightbulb moment for me. So good.
Sean Thomson 19:35
If you're going into a market it's not enough to talk to the brokers, you need to go build a team in that market, if you can. I mean, league legal, you could probably have legal come from other places. But you know, then some property management companies are nice nationwide, and lenders are nationwide, of course, but you want to make sure that the brokers that you're dealing with in that market, you're dealing with a team that they're comfortable with, it gives them a greater comfort level, especially if you're new And if you're just kind of bridging into that market to your even if you have experience and you're coming into a new market, those people don't know you, right? So anything you can to to give them an additional level of comfort with giving you a deal, awarding you deals that that's a good thing, right? So I, I would recommend to anybody, if you're going into, you know, whatever town you're going into as a new market, go and go and research property management groups, lenders that work there that are regularly, you know, and talk to the brokers that do business there and get their referrals.
Brian Briscoe 20:31
Yeah, absolutely. Great. Points. Great points. So, specifically, so find finding the deal, you know, 76 units, how did you find the deal and walk walk us through, you know, from, you know, finding the contract to, to due diligence?
Sean Thomson 20:47
Well, I had developed a relationship with the broker team that was that was operating this deal, we looked at a few other properties, we've gotten the best and finals and had, you know, high level discussions with the brokers team, and they really had given me a shot, right. So it's really, it was really them, being willing to take a risk on an on a new guy like me, right. And part of it, I think, was that I did build a team that they were, they could trust. And so I was really kind of the outlier, the rest of my team was fine, right? But it allowed me to, to give them a comfort level, so that they would they were willing to work with me on on pushing a contract through right, or getting a deal through, you know, brokers, they kind of downplay their influence on this process. And they really do have quite a lot of impact on if you're going to move up the chain or not. And then in an environment like I'm in in Dallas, they're getting 30 offers on these properties, you know, people are just lobbing offers in on deals, and, you know, there's going to be five or six in that group that the brokers know like and trust. And that came in with the right number. And, you know, the right mix of terms. And those people are going to progress through. And it gets down to a point where the broker team and the seller team, they have to be comfortable with you, because it's going to be it's going to be I was just in a best and final worse, there were six, six offers, all of them were coming in around the same. And I was always getting pushed to the top. Because because they they closed deals with me. They knew who I was, you know, so they weren't sure about these other groups, you know? And so it's it's that relationship that really makes the difference, I think, yeah. And they're the ones that kind of helped me through the process. And the reason I really went after this deal, this isn't like this deal doesn't hit all my BuyBox numbers, it's a little bit older than I want. It's a little bit smaller than I want. It's, you know, so it's not it's not perfect deal by any means. It it works for us, but it's not. It's not like if you had to draw out a perfect deal. This is not it. Yeah. But I had everything else was perfect. Right. The brokers believed in me, you know, the race was right, you know, so all those things were kind of lined up.
Brian Briscoe 23:01
Yeah, absolutely. Cool. So yeah, I love how that all came together for you. And, you know, one thing you said, you know, your buy box, you know, a lot of our, a lot of the things that we've closed on our, you know, near misses, you know, so they're, they're, they're really close to the edge of the buy box, you know, and it's one of those things where, when you see a good deal, you know, if it's if it's close to your criteria, I know, we still try to jump on those, even though it's not perfectly in our criteria, because that that perfect deal comes by it's like a once in a lifetime type thing. So, so $8 million purchase price, you know, what was what was the capital raise on this one?
Sean Thomson 23:39
Well, we did a bridge. So it's, you know, we have a bridge on the property, and the bridge also covered our CapEx Nice. So we didn't have to raise a ton of money, I would think it was around two and a half million. You know, because we had maybe 700,000, in in capex that that the the the lender took care of for us. So it was it was pretty, pretty modest for for first deal, but it was still substantial. I mean, you know, two and a half million I don't have that laying around.
Brian Briscoe 24:08
I don't either. Yeah. So we'd like to one day, but
Sean Thomson 24:11
I had to go we had to go look for it, you know? Yeah.
Brian Briscoe 24:14
Tell us about some of the the challenges you had on the capital race.
Sean Thomson 24:19
Well, we had you know, I didn't focus on it. So my my I spent the first few years of my business developing a deal system a deal machine, right. So I I, you know, I got to where I can be invested vinyls pretty much at will, you know, I can find deals that work. And there's tons of deals out there that people keep telling me that there's no deals and there's tons of deals out there. It's just a matter of can you make them work for your for your system, right. And we were able to find deals that were that were working. I was invest in finals every month, you know? And so that was kind of my business was I was focused on deal finding and why was what I was neglecting. The whole time was capital raising because I sort of had some, some investors that we had from our Single Family Day And, you know, we were fortunate that people know me pretty well. And they're like, hey, Shawn, we, you know, they just, they just kind of give me money, right? Because they, they know how I conduct my business and my family, my life, and they trust me, you know, and, and I'm really fortunate that I have that support from a number of people. So we had quite a lot of money sort of queued up. That was we I personally talked, everybody said, Hey, this is our transition, and we're gonna move in this direction. And they were all very supportive. You know, we had I had people that waited the whole time to place their capital, to place it with us, you know, the whole time we were trying to buy these deals, and which was, you know, it's a year and a half of time, maybe two years of time that they're, they're there. I told them, we're going to do this. And they're like, Okay, great. We'll wait, right? They've got, you know, $100 waiting around for me to find a deal, right. And so we're very fortunate in that regard. But I didn't, I didn't go beyond that. I didn't, I didn't start exploring new investors or, you know, capital sources or anything like that. So it was a bit of a struggle, when it really came down to it. I thought, Okay, well, I can make this happen. Yeah. But we did have to struggle. And I had a couple partners that I was bringing in as, as part of the deal as well. And those guys had fallen fallen out. And so I was a little bit short, we had to make up that shortfall and a few other problems, but we made it through but it was, I think, focusing on now I'm focused more on capital raising, because it doesn't matter how good you are at finding deals, if you can fund them, it doesn't, you know, doesn't matter.
Brian Briscoe 26:28
Yeah, you know, and I, I was smiling a couple of times through that, because I made the same mistake. You know, somebody told me early on, if you have a good deal, the money will come. And, you know, I focus 100% on deal finding and our first raise, we got the amount, but it was not easy. But so so we talked
Sean Thomson 26:46
about, yeah, but the whole thing about finding the deal, the money will come it's not true. Because it's, it's a lot of its timing, a lot of it is metrics, you know, people, everybody has to be kind of in the same place that you're thinking they need to be at that time. Oh, yeah. And it's not always true. So I would definitely focus on capital raising,
Brian Briscoe 27:02
people have to know who you are before they're going to invest, right? So you can have the best deal in the world. But, you know, if you're an unknown quantity, you're not going to get the money, you know, so, you know, it's it's definitely not a not a true statement. You know, if you put a couple of caveats in there, you know, if you have a really good network, you know, and you have a good deal the money will come. Right, so we talked about finding the deal we talked about funding the deal. Let's talk about closing the deal and you know, what, what snags popped up during the process?
Sean Thomson 27:35
Well, I I was kind of in charge of everything so as I guess I am most always in charge of everything but so I was with you know, new lender new new lawyers knew everything and but I was negotiating all the terms of the contract all the you know, all this stuff. So my attorneys kind of took a hands off approach on that part. But so I the closing was, was kind of tough i i actually kept track of just my so my inbound emails from the time I looked at the deal to the time I closed the deal, the day that it closed, they like that to their close it. Just my inbound emails for this one deal. Were 13 172 emails, wow, that's not my responses. That's just the emails that I received. You know, because you have a title office, you have a lender, you have attorneys, you have, you know, all these different entities that are that have to communicate with you and each other, and you're copied on all those things. Right. So yeah,
Brian Briscoe 28:29
and a lot of them you have to respond too quickly to so.
Sean Thomson 28:33
Oh, yes. An emergency every five minutes. Oh, yeah, this document gotta have that document, you know,
Brian Briscoe 28:38
have your little bucket brigade with you to put out fires every every 30 seconds. So yeah, it happens like that. So So 13 170 or so emails, you know, to get to the closing point. Yeah, yeah. So Well, cool. So let's see you guys closed remind me when you closed
Sean Thomson 28:58
a month ago, so yeah, so we took over a month in three days ago, right, because we just had our first month sort of round up and we're just getting in the financial statements now and the data and stuff now to kind of see how the first month was the first month it just was the property that we bought they had zero systems so just to give you an idea when I asked for I asked during the during the closing process I asked the seller for an inventory you know, like the shed in the office and he just sent me pretty much I'm paraphrasing but everything in the maintenance shed is yours. Everything in the office is yours. Good luck. On upon a piece of paper he wrote it on Yeah, put on a yellow sheet and fax or scanned it email it to me. Yeah. And that was it. So that's how he kind of ran his business just on pens and pens and paper right. So there was no systems in place. So we've been you know, having to get all the all those systems up and running and, you know, kind of modernize the business. So a lot of the first month has just been trying to get everything kind of dialed in. But I think we're going to be doing that for several months actually to get it to get it going. But yeah,
Brian Briscoe 30:04
we've inherited a lot of maintenance sheds with a lot of just random stuff in there, you know, so, yeah, it's useless. Yeah. You know, and I mean, and I'm sure it's, it's the, you know, the, the maintenance guys, you know, part of, it's probably a little bit of laziness, and part of it's probably, uh, you know, I might not, I might need this later, you know, so let's keep it here. And if we need it later, it's easy to get, and it just accumulates. And, yeah, we we've inherited a couple of issues like that. And it just, I mean, it's not necessarily a it's not a terrible thing. It doesn't really affect the operations. But you know, if, if you're, if you're going to take your time and go through it and set up your own systems and inventory, it does take some time. Yeah, for sure. Oh, that's great. So So transition went well, your your month into it. It Have you started a lot of your capex, you mentioned 700 or eight, I think 800,000 or so in capital expenditures. Have you started any of the other capital expenses or the renovations yet?
Sean Thomson 30:58
No, not really. So sorry, my phone? No, no, not really, we we are just sort of turning units at this point. And we're sort of coming up with a game plan for everything, we have a few large deferred maintenance type things that we're doing on the property. So we're kind of game planning those getting bids in, like, give me an idea. So the mailboxes don't work. And the whole, the whole property can't get their mail, half the property can't get their mail in the mailbox is because the previous owner just neglected the mailboxes. And they're falling apart. And so now we're having to sort of deal with that on our emergency level. We knew that going in, of course, and we have a plan for it. But we're executing that plan. But even if you wanted to do it today, you can't you have to order mailboxes. Those take 60 weeks, you
Brian Briscoe 31:41
know, either. I mean, it's not cheap. It's not easy. We've had to replace a couple of those.
Sean Thomson 31:45
Yeah, so it's, you know, and we have we have the money allotted. And it's everything's there. But it's it just takes sort of time now, to get things you can't just go down and buy buy mailboxes at Home Depot, those have to be ordered in it takes, there's a lead time for everything. So we're kind of restructuring right now what we're doing the emergency items as fast as possible. Yeah. And then we're trying to work kind of structure now's a game plan for construction. So that we're hitting everything as efficiently and as effectively as possible. And as quick as possible, right. So everything here in Dallas moves really rapidly. You know, so you got to really kind of be moving fast as you can. But you're in a you're in an environment that everybody wants to, to put the brakes on, right, everybody wants to take their time. So you know, it's just a matter of pushing as hard as you can to get things done. But dealing with all the slowdowns and delays and things like that, that come up. So
Brian Briscoe 32:36
yeah. All right. So um, last couple of questions. As we wrap things up, what advice would you give an aspiring investor, that's maybe six to 12 months behind where you're at now?
Sean Thomson 32:47
Well, depends on where you're on your face. Right? So I think, and I mentioned this before, but I have sort of a process that I go through anytime I'm trying to develop a new business or plan or execute something new in our business. And I think it all starts with the Well, first of all, it starts with your dream, right? What do you want to do? What What's your vision? What's your line, your dream? But I think the first hurdle that everybody over has to overcome is believing. Right? They have to believe that it's possible for them. Yeah, you can see that it's possible, because you're doing it, I'm doing it right. So someone said themselves, hey, I want to buy an apartment building, you can see that it's possible. It's, there's people out there executing this somebody else. Yeah. Right. But believing that you can do it is the biggest struggle, really, I think, and that's something that you said, that sticks with you, you have to constantly remind yourself, I can do this, right? I've had two or three incidences in this whole process of buying this first deal where I thought maybe I'm just not built to do this. Maybe I'm not, maybe I don't have the equipment mentally or, you know, physically or whatever it is to do this, you know, and, and you have to just constantly remind yourself, and believe in yourself and keep moving forward through the fear, right? You have to keep keep conquering that fear that you're that's gonna come up all the time. And anytime you're doing something that's bigger in your life, I mean, you know, what we're, what I did was 100x my business pretty much overnight, and I went from buying $80,000 You know, houses to $8 million projects. Right? Right. And that's, that's, that's daunting. And it's there's a lot of fear that you have to overcome to get through that process and to be successful at it. So I think if I were telling anybody, I would say make sure you believe in yourself, you know, get through that first hurdle and continue to believe in yourself and do everything you can to get through those fears that you're that are going to come up that would be that's that's that I hold on to that all the time. For me. Priceless.
Brian Briscoe 34:35
Yeah, absolutely priceless. All right. And then the second
Sean Thomson 34:39
thing I would tell you is, if I were to start my business over again today, if I were if this were two years we were on two years ago, or three years ago, whatever. And I was going to start this over again today. I would really focus on capital raising, you know, in multifamily. There's silos of responsibility you have, you know, deal finding and capital raising as your two primary silos of work. and I would definitely focus on raising capital because you have the capital you can, you can find the deals to get into, like, you're gonna have deals I could partner with you, you know, you find people that you you want to find people that you can work with and partner with it, you know, like and trust if you're raising capital. But raising capital is really the first thing I would start with, I did it the other way around. And I think it made it more complicated to, to execute my second deal I was able to get through my first deal. But as soon as I completed my first deal, I had all these opportunities come my way. And my first thought was, how am I going to pay for it?
Brian Briscoe 35:31
How am I going to raise the money for this now? Yeah,
Sean Thomson 35:33
I've already got the money. So if I had, if I had a raised capital raising sort of business already built, my second deal would have been much easier. It'd be much, much more less complicated.
Brian Briscoe 35:45
Yeah, yeah, I agree wholeheartedly. You know, our second deal was much smaller than our first deal. Usually people go the other way around, they try to go bigger. But our second capital raise ended up being pretty easy because of the relative size of it, you know, first capital raise 2,000,002nd capital raise was like, 500,000. So But had we had we gone bigger, we would have run into the same problem. It's like, we already tapped out our close friends and family. And we hadn't quite built that capital raising train yet. So yeah, for us. That was that was difficult, too. And I agree. So last question. Before we we close? how can listeners learn more about you?
Sean Thomson 36:25
Well, we have a podcast, you know, I do a podcast every week, just like you do. It's a next level American Dream podcast. And you know, we just talked to people the whole idea of the podcast is I love the American dream. I think that's a fantastic thing. But I think the American dream of the 50s is dead, right? Yeah. You can't work for a company for 40 years and retire on a pension. It just doesn't happen anymore. But the American dream as a concept is very much alive. It's it looks like 1000 Different things now, though, you know, there's people hustling Bitcoin, there's people hustling, you know, Amazon shops, there's people hustling all kinds of things, and they're making their American dream come true, right. So I love to talk to people. We focus on real estate, of course. But I'd like to talk to people that are out there achieving their American dream, or people that are helping others achieve their American dream. Yeah. So you know, if someone has a, I've had people that are accountants that have coaching programs, all sorts of things that they're actually out helping others, like me achieve their American dream, too. So that's kind of the focus of the podcast. We don't really delve too much into like, deals, details or anything like that. But I just like to, I like to have people talk about what they're doing and inspire other people maybe to go out and achieve their American dream if they're kind of on the fence. You know, if you're in corporate America, and you're just like, I don't know what to do. Maybe you'll hear someone on my show that says, I can do that. Right. Yeah. And I think if you go to our website, just Thompson multifamily group, all right, calm. And my front, my last name is spelled a little bit uniquely as th O M, S O N, there's no P
Brian Briscoe 37:51
No silent P it's, you know, kind of almost almost spelled how it's pronounced. You know, I've always wondered how the th turns into a tongue in Thompson. But yeah, I'm not a linguist.
Sean Thomson 38:03
So it's just Thompson multifamily group comm. And from there, you can that's kind of our hub of information, you can get our podcasts there, you can learn more about our investing, you do everything you can reach out to us, you can I think you can even schedule a meeting with me on there. For a 15 minute phone call phone call, you know, I do those all the time, people reach out to me, they just want advice on their business or something like that. And I, I take calls all the time like that. So you know, we're pretty easy to access.
Brian Briscoe 38:29
Awesome. And what we'll have is that the link in the show notes? Yeah, and very much so very much appreciate your time today. You know, I've learned a couple of things. I think this is a lot of what you you have gone through, you know, a lot of other people are facing as well, you know, that the idea of believing in yourself. You know, it was something that I struggled with first, you know, the idea of that, that jump from the single family to multifamily and getting there you know, it was something that I think a lot of people that we've talked to on this show have faced So, once again, appreciate your time and the wisdom that you've been able to impart today.
Sean Thomson 39:02
Yeah, thanks for having me on. I really appreciate it was a lot of fun.
Brian Briscoe 39:10
Thank you for listening to the direction apartment investor podcast today brought to you by four oaks capital. If you'd like to know more about how to invest in apartment buildings or want to be a guest in our show, visit our website at four oaks capital comm slash podcasts or email us directly. If you're still listening, you obviously like the show. So pull out your phone app, subscribe, and leave us a five star rating on your favorite podcast app. And we'll see you again next week.
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